News & Insights

What is a False Claim?

July 20, 2018

SHARE :

The False Claims Act (FCA) is the government's most powerful and effective tool used to combat fraud. Notably, more than half of the payments determined to be fraudulent in 2015 under the FCA came from payments related to healthcare.

There are many things that healthcare providers or their office staff do that could potentially result in a False Claims audit or investigation. Not surprisingly, ignorance of the law is no excuse. Practice managers need to understand how the FCA affects their organizations to avoid a violation.

Examples of FCA Violations

Upcoding

Providing substandard care

Failing to return credit balances

Inappropriate use of modifiers (25/59)

Billing for services performed by an excluded individual

Billing for medically unnecessary services

Unbundling

Waiving copayments and deductibles

Billing for a new patient when you should bill for an established patient

Charging Medicare patients more than non-Medicare patients for the same service

Falsifying medical records to increase payment

What You Can Do

Develop and follow a comprehensive compliance plan in your practice

Develop and follow a financial policy that addresses coding, billing and adjustments

Audit claim forms and medical record documentation proactively and often

Consistently enforced internal controls together with a comprehensive patient financial policy can minimize a practice's risk of violating the FCA. Detailed policies and procedures addressing Revenue Cycle processes are also a key to fraud prevention and a valuable risk-mitigating factor in case of an audit.

To assist our insureds and their practice managers, LAMMICO Practice Solutions provides education, resources and personalized consultation on Revenue Cycle Management. LAMMICO insureds can log in as a Member at LAMMICO.com to access these complimentary resources. In addition to helping mitigate the risk of false claims, these resources can help optimize your Revenue Cycle.

This is not legal or financial advice, and is not intended to substitute for individualized business or financial judgment. It does not dictate exclusive methods, and is not applicable to all circumstances.